Focus: Wheat Trend Strengthening
Last week the grains held their gains in a holiday-shortened week. March corn ended the week where it started at $4.12-2. January soybeans rose 18.25¢ to close at $9.70. March wheat climbed 11.75¢ to end the week at $6.11. Wheat’s daily trend strengthened as evidenced by the ADX line which rose from 23 to 30 last week (daily chart). The balance of power has clearly shifted to the buyers following the multi-year price low established on Dec. 5 last year. The hourly chart of wheat shows weakening of the uptrend, and an ADX Head and Shoulders pattern is forming. This pattern suggests the hourly trend is weakening and ready to enter a period of retracement. This week, watch price in relation to the trendline.
Chart Courtesy of TradeStation.
Dr. Charles B. Schaap transitioned from health care to wealth care in the nineties. He is the author of ADXcellence —Power Trend Strategies and Invest with Success—Big Profits for Small Investors. Dr. Schaap is a commodity futures strategist and recognized authority in technical analysis of the financial markets. His website is www.adxcellence.com.
